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Will Bitcoin touch $100K in 2021? Here’s why you should invest now

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The past year has been one of its kind - a global pandemic, market uncertainty, countrywide lockdowns, travel restrictions etc. Yet, we witnessed one financial asset on the rise - Bitcoin. The new-age digital currency saw a price recovery from Rs 6,00,000 in March 2020 and is currently trading at around Rs 43,90,000.

The rally in Bitcoin and other crypto doesn't seem to have run out despite the 600% surge in price. And with emerging startups such as CoinSwitch Kuber trying to make Bitcoin investing effortless, millions of retail investors have joined the Bitcoin Bandwagon.

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Putting short term volatility aside and looking at the long run, analysts state that it could touch $100,000 (Rs 72 lakhs) next year.

The rise of Bitcoin
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In 2009, the first-ever digital currency, Bitcoin, was introduced as an alternative to the current financial system's loopholes. During the time, Bitcoin was valued at $0, and just a few crypto nerds would mine them as a collectible. After 2010 - The Bitcoin Pizza Transaction happened, people looked at it as a currency that could be used to purchase goods and services.

By 2013, Bitcoin gained more popularity and touched $1,000. After the second Bitcoin Halving event took place, the coin rose significantly in value to $19,000. However, there was a minor blip, and after 2018, its value dropped and its price settled at about $5,000 at the start of 2020.
Since then, it has been a year-long rally amid two significant events.

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  1. The global pandemic: most people sought bitcoin as a hedge against the shaky economic crisis caused by the spread of Covid-19. Even institutional investors such as Microstrategy, Tesla, Square Corp etc., resorted their cash reserves into Bitcoin, stating that it was a good store of value against inflation.

  2. Third Bitcoin Halving event: Halving happens once in four years, where the rewards of Bitcoin Mining are cut down by half. After the third halving, the mining prize, 12.5 BTC, was reduced to 6.25 BTC in May 2020. It reduced the coins in circulation significantly, thus triggering a higher demand.

After a steady rally was set off in Oct 2020, the value of Bitcoin has touched new heights - crossed $20,000 in Dec 2020, $40,000 in Jan 2021, hit $50,000 in Feb 2021 and is now trading around $54,500 globally.

Could Bitcoin really hit $100,000?
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The digital currency that was once viewed as mysterious by many in the past has now exploded in both value and popularity. It has mainly become mainstream - Giant financial institutions like Paypal, Visa, JP Morgan etc., are offering crypto services, and more retail investors are interested in purchasing Bitcoin now more than ever.

Despite its volatility, bitcoin has surged in value, especially in the past year. We could attribute this Bitcoin rally to two things:

  • Better trust

  • Global trends

Early on, major concerns revolving around Bitcoin were, 'Will it get hacked?', 'Is decentralization a truly workable solution', 'will halving break the system?' etc. Now a decade down the road, many of these issues have been answered. Bitcoin works on reliable technology, and it does not break.

At the same time, the world is now witnessing Bitcoin being associated with more institutional investors like Tesla, Microstrategy etc. Most institutions are now considering converting their cash reserves into Bitcoin as a hedge against financial crises.

Of course, many other cryptos have joined the race, which diverts some retail investors' interest away from it. Nevertheless, it remains the most significant cryptocurrency with a total market capitalization of $1.15 trillion, higher than the combined market cap of the world's three largest banks (J.P Morgan, Bank of America, and The Industrial and Commercial Bank of China).

Bitcoin is now closer to $100K than it is closer to $0. The recent developments around Bitcoin worldwide are a testament to the fact that it is inching closer to becoming a mainstream asset class.
Analysts believe that if the trend continues, Bitcoin might hit $100k by the end of 2021. The predictions are based on the stock-flow-model - 94% correlation to Bitcoin price. This model is used to measure the scarcity of commodities such as gold.

Is it too late to invest in Bitcoin?
Bitcoin has been breaking into all-time highs every month since October 2020. It surpassed the mark of $50,000 (₹37 lakhs) recently, and it seems to be heading near $60,000 (₹43.5 lakhs) soon.
Although it would have been ideal for an investor to have entered the investment space earlier in 2020, it does not mean that it is now too late to invest in Bitcoin, provided that you invest what you can afford.
There may be dips in its value from time to time, but even a small investment you make in Bitcoin today could return manifold in the long run.

What is the minimum investment required to buy Bitcoin?
Although one Bitcoin price may seem overwhelming, retail investors can choose to buy fractional amounts of Bitcoin. Some Indian platforms, such as CoinSwitch Kuber, allow its users to invest in Bitcoins with a minimum of just Rs 100.

Considering the above data and trends around the crypto market, we could say that there is a lot of margin-left for Bitcoin. Its value could only increase in the future.

Disclaimer: This above is non-editorial content and TIL hereby disclaims any and all warranties, express or implied, relating to the same. TIL does not guarantee, vouch for or necessarily endorse any of the above content nor is responsible for them in any manner whatsoever. The article does not constitute investment advice. Please take all steps necessary to ascertain that any information and content provided is correct, updated and verified.( Originally published on Mar 22, 2021 )

(What's moving Sensex and Nifty Track latest market newsstock tips and expert advice on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds.)

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Rita

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Goodnews to everyone in this group. With the recent COVID-19 lockdown STUCK AT ...Read More

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Experts on how Artificial Intelligence & Machine Learning will impact India's national security

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Synopsis

A panel of experts will deliberate on the future of India’s military prowess and share insights on how Artificial Intelligence and Machine Learning will impact national security.

By Pallavi Arun Verma, ET SpotlightLast Updated: Mar 25, 2021, 12:54 PM IST14

To initiate a dialogue on technological developments in the aerospace and defence landscape and to create an innovative roadmap for India's defence ecosystem, Economic Times Digital is hosting a one of a kind Defence Summit bringing experts and commentators together.

Maroof Raza, Media Commentator on Global, Military & Security issues will open the ET AeroDef Summit 2021 and shed light on how Artificial Intelligence and Machine Learning will impact national security. Eminent speakers and industry experts like Deepak Hota, Former CMD, BEML, Anuj Prasad: Partner (Head - Aerospace and Defence), Cyril Amarchand Mangaldas and Major General Rohit Gupta, SM (Retd) Head Aerospace & Defence, Primus Partners will share their insights on initiatives like Make In India and how India can become a self-reliant military superpower.

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Commodore Anil Jai Singh, IN ( Retd); Senior Vice President, Thyssenkrupp Marine Systems India, Ratan Shrivastava, Aerospace & Defence Expert, and MD, BowerGroupAsia (India) Ltd) and Abhishek Verma, Partner and Lead (Aerospace and Defence), KPMG will deliberate on India’s military prowess and share insights on the future of defence and warfare.

Discussion points
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(This article is generated and published by ET Spotlight team. You can get in touch with them on etspotlight@timesinternet.in)

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Balhans Jayaswal

Good money comes at a price. In this case, unpalatable work stress. Take it or leave it.

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Indians are leading in IT/AI..
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Payments startup MobiKwik targets IPO by September

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MobiKwik is planning to file its draft IPO prospectus by May for an offering in Mumbai that could value the company at more than $1 billion.

By BloombergMar 22, 2021, 02:14 PM IST1

By Baiju Kalesh

One MobiKwik System Pvt, the Indian digital wallet and payments startup, is targeting an initial public offering before September that could raise between $200 million and $250 million, according to people familiar with the matter.

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(What's moving Sensex and Nifty Track latest market newsstock tips and expert advice on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds.)

Download The Economic Times News App to get Daily Market Updates & Live Business News.

READ MORE NEWS ON

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